An uplift is applied to a member's pension when retiring from active status after NPA (i.e. member's SPA as specified in legislation at the date of the member's retirement).

A new policy is in force so that members of the 2015 Scheme who opted out of the scheme but remain in employment beyond Normal Pension Age may be entitled to an uplift when retiring. This change has not yet been introduced through scheme regulations. If an uplift is required for any other members retiring from preserved status (i.e. where benefits are not instead backdated) please refer these cases to GAD. Different LRFs apply on retirement from deferred status. Factors and guidance will be provided in future versions of this guidance as circumstances indicate they are required.

The benefits payable on late retirement are determined by applying the appropriate uplift factor(s) from Tables LRF1_NHSPSS_2015 and/or Table LRF2_NHSPSS_2015 in the consolidated factor workbook to the benefit entitlement at the date of retirement as follows.

Uplift factors are provided for periods of years and months. The appropriate factor should be selected based on the period between date of retirement and NPA (or RRA as applicable) in complete years and months. For all calculation purposes NPA should be replaced by Reduced Retirement Age (RRA) (see Introduction and Allowance for ERRBO below) where applicable to all or part of a member's entitlement. RRA will apply for some or all benefits where a member has or had an ERRBO agreement during their scheme membership.

A member with an ERRBO agreement, working beyond RRA may continue to pay contributions after RRA, but no later than NPA. Where contributions continue after the 31 March preceding RRA, benefits earned after that date will be subject to uplift based on the period by which final retirement date exceeds RRA. Where contributions cease on 31 March preceding retirement, benefits earned after that date have no RRA.

Late retirement pension =

(Scheme pension (no ERRBO agreement)) x LRF1 (based on NPA)

+ (AP - pension debit due to divorce) x LRF2 (based on NPA)

+ Main scheme pension (RRA(1) x LRF1 (based on RRA(1))

+ Main scheme pension (RRA(2) x LRF1 (based on RRA(2))

+ Main scheme pension (RRA(3) x LRF1 (based on RRA(3))

- Pension debit due to Scheme Pays election

Where:

LRF1 is (are) the late retirement factor(s) from Table LRF1_NHSPSS_2015.

LRF2 is the late retirement factor from Table LRF2_NHSPSS_2015.

Pension debit due to divorce includes increases to date of retirement in accordance with the scheme regulations.

Points to note in using factors:

• All pensions (including AP) should include revaluation/pension increases to date of retirement. Revaluation/increase is in accordance with the scheme regulations.
• Scheme pension (no ERRBO agreement) should include any transferred-in benefit (revalued to date of retirement) but should not allow for any pension debit resulting from a divorce order (as this is allowed for separately - see above).
• Any pension debit resulting from a Scheme Pays election should be allowed for as shown.

Members may have chosen to contribute to an ERRBO agreement. The period during which the member contributed is known as the Buy-Out period. If so, the calculations should be carried out by reference to the member's "Reduced Retirement Age" (RRA) as applicable to each Buy-Out period (if the agreement has been varied). All benefits earned during any Buy-Out period will be subject to an effective RRA. For the purposes of this document RRA is determined based on SPA as specified in legislation at the date of the member's retirement less the period(s) of reduction secured by the agreement. Note this may be different to RRA as determined for the purposes of setting the cost of the agreement (which is linked to SPA as set out in stated Government policy). See Introduction.

For the purpose of determining the applicable LRF1 factor from Table LRF1_NHSPSS_2015 in the consolidated factor workbook, or LRF2 factor from Table LRF2_NHSPSS_2015 in the consolidated factor workbook, the member's RRA for each Buy-Out period should be used separately in place of the member's NPA. Thus different factors will be applicable to benefits accrued at different times.

On late retirement, pension debits should be increased to reflect that the debit will be in effect for a shorter period. Pension debits should be treated as (negative) Additional Pension for the purposes of determining which uplift factors should be applied (as both are subject to PI increases in the period before retirement).

Subject to meeting certain conditions, members liable to an Annual Allowance charge can make an election requiring the Scheme to pay an amount of the charge on their behalf out of their pension benefits (referred to as 'Scheme Pays'). If a member has previously elected for Scheme Pays they will have a negative DC balance at retirement. This balance must be converted into a benefit reduction when the member takes their pension benefits.

The benefit reduction is in the form of a deferred pension debit. The pension debit is subject to annual increases in line with the Pension (Increase) Act 1971. Dependants' benefits are unaffected by Scheme Pays, i.e. reductions do not apply to dependants' benefits payable death in retirement.

On late retirement, the pension debit due to Scheme Pays should be applied to main scheme benefits after they have been increased to allow for late retirement. The debits should be applied to benefits before any other member options are exercised, e.g. commutation. Please refer to the guidance Reduction to benefits due to Scheme Pays Annual Allowance Tax Charge for more details and factors required to calculate this benefit reduction.

No specific test is required on retirement in cases where a member has a GMP in the NHSPSS 2015 as a result of a transfer in to the scheme.